Student Loan Forgiveness Programs

| January 2, 2012

Americans are facing some of the hardest times ever on the economical front. One of the biggest issues is jobs and that includes jobs for college graduates. These once abundant jobs are needed to help former students pay back their loans.

Student loans have become the largest debt that faces Americans reaching $875 billion even surpassing credit card debt. Student loan debt will hit $1 trillion this year. Fueling this debt is the fact that college tuition has risen over 400% since 1982.

Facing these facts combined with the scarcity of the once higher income level jobs for college graduates many former students are looking for student loan forgiveness. Graduates have taken low paying jobs just to survive and can’t afford the now due loan payments.

If you have a government student loan such as a Stafford, Perkins or Direct loan
there are loan forgiveness programs available. They usually fall under two types of circumstances one is of dire economic hardship and the other is by being employed in certain professions but certain conditions must be met.

Teachers
One of the largest student loan forgiveness programs is for teachers. Students who have entered the teaching profession and teach in secondary or elementary schools serving students from low-income families or special education are eligible for loan forgiveness. Other areas include math, science, bilingual education, teaching students with disabilities and teaching in other areas designated as teacher shortage areas. As an example loan forgiveness can vary from a $5000 cap up to a $17,500.00 cap. A Perkins loan may be eligible for a 100% cancellation.

Attorneys
Loans can be forgiven for attorneys that serve full time in the public interest or for an advocacy or protection agency or non-profit organizations. The non-profit organizations must provide assistance to low-income of disadvantaged clients at no cost. Normally a contract is signed to work in this type of service for at least three years.

Nurses and Physicians
There are also groups such as the National Health Service Corps that offer loan forgiveness programs for nurses and physicians. The nurse or physician must agree to practice in areas that lack adequate medical care or are economically depressed. They will be required to do this for a set number of years.

Other Occupations
Other occupations that may qualify for loan forgiveness include military service, fire fighters, law enforcement and corrections officers, Peace Corps or Vista volunteers, librarians and those who serve in certain sectors of public service or areas of national need.

Other Circumstances for Loan Forgiveness
• The school closed within 90 days of enrollment
• The school did not properly qualify you for attendance
• You become totally and permanently disabled
• Upon death of the borrower

The loans discussed in these cases include various types of federal loans such as Stafford loans, Perkins, PLUS and Direct loans. Loan forgiveness amounts will vary for these programs check for the latest information.

There were no forgiveness programs for private student loans. There are also no provisions for discharging private student loans through bankruptcy which may be possible for federal loans. Current solutions for relief from private loan debt include possible loan consolidation or contacting the lender to make modified repayment arrangements if possible.

Category: Student Loan

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